The Real Madrid and Portugal forward was announced as the winner at Tuesday's (AEDT) ceremony in Zurich.
Ronaldo beat fellow finalists Lionel Messi and Antoine Griezmann to the new FIFA honour, the trio having topped a shortlist of 23 global stars.
The triumph adds to the Ballon d'Or crown the 31 year-old picked up last month, which was the fourth of his career.
Ronaldo claims both of the game's top individual honours after an astonishing year.
He scored the winning spot-kick as Madrid beat city rivals Atletico Madrid in a penalty shoot-out to win the Champions League, having struck 16 times throughout the competition.
Ronaldo also netted a hat-trick in the Club World Cup final as Madrid beat Kashima Antlers 4-2 after extra time in a thrilling contest.
A first major international trophy also arrived with Portugal emerging as the surprise winner of UEFA EURO 2016, Ronaldo scoring three times during the competition before suffering an injury in the final against France and willing his team to victory from the touchline.
He scored 55 goals from a total of 57 appearances for club and country across 2016.
The award is a modernisation of the FIFA World Player of the Year, which was last won by Messi in 2009 and had been given to Ronaldo once – in 2008 – before the merger with France Football created the FIFA Ballon d'Or.
The world game's governing body ended that collaboration last year and the winner was selected via a voting process involving national team coaches and captains, selected members of the media, and an online fan poll.